Correlation Between EPL and BF Utilities
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By analyzing existing cross correlation between EPL Limited and BF Utilities Limited, you can compare the effects of market volatilities on EPL and BF Utilities and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in EPL with a short position of BF Utilities. Check out your portfolio center. Please also check ongoing floating volatility patterns of EPL and BF Utilities.
Diversification Opportunities for EPL and BF Utilities
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between EPL and BFUTILITIE is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding EPL Limited and BF Utilities Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BF Utilities Limited and EPL is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on EPL Limited are associated (or correlated) with BF Utilities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BF Utilities Limited has no effect on the direction of EPL i.e., EPL and BF Utilities go up and down completely randomly.
Pair Corralation between EPL and BF Utilities
Assuming the 90 days trading horizon EPL is expected to generate 1.78 times less return on investment than BF Utilities. But when comparing it to its historical volatility, EPL Limited is 1.55 times less risky than BF Utilities. It trades about 0.06 of its potential returns per unit of risk. BF Utilities Limited is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 36,885 in BF Utilities Limited on September 14, 2024 and sell it today you would earn a total of 55,965 from holding BF Utilities Limited or generate 151.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.59% |
| Values | Daily Returns |
EPL Limited vs. BF Utilities Limited
Performance |
| Timeline |
| EPL Limited |
| BF Utilities Limited |
EPL and BF Utilities Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EPL and BF Utilities
The main advantage of trading using opposite EPL and BF Utilities positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EPL position performs unexpectedly, BF Utilities can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in BF Utilities will offset losses from the drop in BF Utilities' long position.| EPL vs. BF Utilities Limited | EPL vs. Kilitch Drugs Limited | EPL vs. Akums Drugs and | EPL vs. Aarti Drugs Limited |
| BF Utilities vs. Allied Blenders Distillers | BF Utilities vs. SINCLAIRS HOTELS ORD | BF Utilities vs. Royal Orchid Hotels | BF Utilities vs. Blue Coast Hotels |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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